US President Donald Trump's administration is considering a limited waiver to its Iran sanctions program to allow for flights carrying Shi'ite Muslim religious pilgrims between Iran and Iraq, a person with direct knowledge of the matter said.

The source, who is involved in the deliberations, said the US Treasury Department waiver would allow Iraqi Airways to fly to and from the Shi'ite holy city of Najaf for one month, with a more permanent waiver then potentially coming into place.

Iraq ordered its civil aviation authority to suspend Iranian flights to Baghdad airport starting September 22, two sources told Reuters, after the United States threatened to sanction any airport that services Iranian carriers.

Tehran threatens to attack countries that cooperate with US sanctions on Iranian airlines

Last week, Tehran threatened to attack the airports of neighboring countries that cooperate with US sanctions against Iranian airlines.

“If a country cooperates with or embarks on adventures with the United States, its airports will no longer be able to operate flights,” Supreme National Security Council Secretary Mohsen Rezaei said at the time.

An Airbus A340-300 of Iranian airline Mahan Air takes off from Duesseldorf airport DUS, Germany January 16, 2019.
An Airbus A340-300 of Iranian airline Mahan Air takes off from Duesseldorf airport DUS, Germany January 16, 2019. (credit: REUTERS/WOLFGANG RATTAY)

Iranian airlines were barred from neighboring countries, including the UAE and Oman, on Thursday following the new wave of US sanctions.

"If Iran is denied the possibility of flight and access to airport services, no country in the region will have this possibility either," Mohammad Mokhber, lead Iranian adviser, said in a statement on X/Twitter on Friday.

Danielle Greyman-Kennard contributed to this report.